A developer sent us a sample project and said that when you run on a listen server and move the player character around, the character model is all blurry as it appears the character is vibrating back and forth very quickly. You can see it in the attached video.
The project is also attached.
Ryan G. mentioned that "the issue is probably related to how the UCharacterMovementComponent handles moves from the client - I'd start in UCharacterMovementComponent::ServerMove_Implementation"
Using the attached project, set your Play settings as follows:
Then hit play and move the character around.
There's no existing public thread on this issue, so head over to Questions & Answers just mention UE-26739 in the post.